The Empire Strikes Back
In a recent commentary by Professor Walden Bellow, it was put forth that “U.S unilateralism and globalization do not mix” - in the sense that the current Bush administration is exploiting an ever interconnecting world to revive the US economy at the expense of other center economies. It is further claimed that because the United States views economic power as a means of fortifying strategic power, Washington continues to pursue certain polices that revolve around the following strategic objectives: gaining control over Middle East oil; aggressive protectionism; manipulation of multilateral agencies to push the interests of US capital; and the incorporation of strategic considerations into trade agreements.
While it is not the attempt of this analysis to defend contemporary American foreign economic policy (or American foreign policy for that matter), it must also be pointed out that there were other points in this commentary that require further debate and speculation – in particular the idea that globalization is in crisis. The author alludes to several key points as indicators of the ‘crisis’ of globalization and these include: the liberalization of international capital flows and the discrepancies of the free market, particularly in view of the global financial system. Professor Bellow makes the point that staunch neoclassical defenders of the market economy were beginning “to leave the fold”, especially after the Asian financial crisis of 1997. “No more to laissez faire”, it was assumed, was beginning to resurface as modish parlance.
Not many would agree with this position. At first glace, it is easy to say that the lack of control in the international financial system was a driving force behind the collapse of Asian capital markets in 1997. But it would be difficult to take on the argument that the free market economy was the chief culprit behind this moment in history. True that a free market system advocates non-intervention by the state; but it also calls for transparency and the ability for competitive businesses to flourish in a society tempered by good governance and fairness, void of corruption and cronyism. Given this it would be difficult to suggest that the Asian financial crisis can be attributed to the perils of a free market system, but more due to the abuse of the system as a result of the lack of political and social development in general. At the same time, it is important not to forget how globalization and the international market have benefited many communities and societies across the world, especially in the areas of technology transfer and access to information.
The assumption that American foreign policy will continue to uphold a unilateralist approach for the moment is not new. But it would be just as difficult to call for more international market control at a time when the US is playing such a strong strategic card. The Bush administration would certainly not give up the chance to be the dominant market regulator in this case. And it would be courageous to call for tighter controls in international capital markets since confidence and trust in the very institutions proposed to take on such an activity, free from corruption and cronyism, has still yet to be achieved.
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